Filenews 9 May 2022
Energean announced the discovery of a commercially exploitable natural gas field with the exploratory drilling "Athena" in the Sea of Israel, which it describes as particularly important, noting that the export of quantities to Cyprus comes to the forefront.
As stated in a statement, the commercially exploitable deposit was discovered in Block 12 in the Israeli Sea, with the first analysis pointing to 8 billion cubic metres (283 billion cubic feet or 51 million barrels of oil equivalent) of recoverable natural gas.
He notes that the discovery is particularly important as it eliminates the risk (de-risk) for an additional 50 billion cubic metres (1.8 trillion cubic feet / (321 million barrels of oil equivalent) of potential resources in total in the area that Energean has called the "Olympus Area". This is a new area identified by Energean that includes the discovery of "Athena" as well as targets in Block 12 and the neighbouring Tanin permit in which drilling has not yet taken place.
He adds that "Athena" can be developed in the short term through a tie-back to the FPSO "Energean Power", enhancing the profitability of the Karish and Tanin deposit development plan. Alternatively, it could be part of the wider development of the "Olympus Area".
In addition, it notes that it is proceeding with the evaluation of all development prospects for the commercial exploitation of the wider "Olympus Region", such as: Further sales of natural gas in the Israeli market, i.e. new long-term contracts (Gas Sales& Purchase Agreements -GSPA) based on the continued development of the Israeli electricity generation market and spot sales.
It also mentions that there are export possibilities, such as a Binding Trade Agreement based on the Memorandum of Understanding (MoU) signed with the Egyptian Natural Gas Holding Company (EGAS) for the supply of up to 3 billion cubic metres of natural gas annually and exports to other regional and European markets through pipelines and LNG through Cyprus or Egypt.
Mathios Rigas, Ceo of Energean Group, said that "we are happy for the announcement of this new natural gas discovery in Athena and the potential of the wider "Olympus Area". We are examining a range of strategic exploitation prospects for both the autonomous development of "Athena" and the development of the wider "Olympus Region", which include the domestic Israeli market and exports.
He added that the discovery of "Athena" and the elimination of the risk for a series of targets in the wider "Olympus Region" confirms the role of the Eastern Mediterranean as a center of global interest in research for the detection of natural gas. In addition, he said, it strengthens our commitment to bring competition and enhance security in gas supply to the region, allows for the optimization of our portfolio in Israel and implements one of Energean's milestones for 2022.
It is noted that the revenues from the natural gas that will be produced by Block 12 are not subject to the payment of royalties to the companies from which Energean purchased the Karish and Tanin licenses, therefore they will be increased by 8% for the same proportional quantities of natural gas.
The elements of the "Athena" borehole
The "Athena" exploration drilling was carried out in Block 12 (Energean Israel, 100%), twenty kilometres from the Karish deposit and 20 kilometres from Tanin A, at a water depth of 1769 metres. The drilling had lasted 51 days and was carried out at a lower cost than the planned budget of 35 million dollars. The "Athena" drilling is Energean's 5th consecutive successful drilling in Israel.
As mentioned, a large hydrocarbon column of 156 metres was found in the primary target of drilling (A, B and C sands). The initial analysis shows that the discovery "Athena" contains 8 billion cubic metres (283 billion cubic feet or 51 million barrels of oil equivalent) of recoverable natural gas. Additional analyses will be carried out in order to determine the total potential and to confirm the quantities of liquid hydrocarbons of the discovery.
Commercially exploitable hydrocarbons were not identified in the deepest secondary target (D sands) which was characterized by a 22% chance of successes.
The continuation of the drilling program
The Stena IceMAX ship drilling rig will be moved to complete the Confirmatory Karish Main-04 drilling and then complete the drilling at Karish North. The decision on whether Energean will proceed with both potential "Hermes" and/or "Hercules" drillings included in the drilling program will be taken towards the end of the Karish Main-04 confirmatory drilling, the announcement concludes.
CNA
